A Ratio That Insults Investors' Intelligence

The average American worker made $19.77 per hour last year. Let's contemplate the hourly pay of some other Americans' wages. Oracle's (NYSE: ORCL  ) Larry Ellison made $46,000 per hour. General Electric's (NYSE: GE  ) Jeffrey Immelt made $12,000 per hour. Boeing's (NYSE: BA  ) W. James McNerney Jr. made $13,000 per hour. CBS'  (NYSE: CBS  ) Leslie Moonves made $33,000 per hour.

An hour is the amount of time Americans might allot for watching an episode of, say, Dirty Jobs in their free time. Speaking of jobs, dirty or otherwise, Discovery Communications' (NASDAQ: DISCA  ) CEO David Zaslav's pay calculation came to $24,000 per hour.

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Superstar salaries
The AFL-CIO released its annual PayWatch data on Monday, dumping a treasure trove of disturbing information about CEO pay into Americans' news feeds. Check out the site here, where you can see a wealth of stats about corporate America's wealthiest, and how their pay compares to that of many regular citizens.

Every year, the AFL-CIO reveals the ratio of CEO pay to that of the average worker. This ratio has dropped a bit from last year's tally of the pay of S&P 500 CEOs, but the outrage meter shouldn't drop. In 2012, the ratio was 354-to-1, not a far cry from last year's 380-to-1.

Let's add some historic context. In 2002, the ratio was 281-to-1. In 1982, it was just 42-to-1. Times sure have changed as "superstar CEOs" have allowed chief executive officers to join the ranks of athletes and movie stars in the realm of decadent compensation compared to the paychecks of most hardworking and less-celebrated Americans.

The upper echelon
Granted, the calculations for these staggering pay figures for chief executives are based on total compensation, which includes stock, options, and so forth. In other words, the CEOs didn't pocket all the money last year, and paper gains aren't the same as real ones.

Meanwhile, some of the CEOs listed, such as Larry Ellison, eschew base salary and bonuses, but still, their pockets have been well padded over years' time through their stock and options. As of March, Forbes calculated Ellison's net worth at $43 billion. In an interesting aside, according to Walter Isaacson's biography, Steve Jobs once chastised his friend Ellison for suggesting Oracle buy Apple to return Jobs to the helm (and help them both make more money), telling him, "Larry, this is why it's really important that I'm your friend. You don't need any more money."

Granted, the bull market of the last several years has helped many of these individuals realize elevated pecuniary gains from any stock they have sold. And regardless, there's no way to argue that these individuals' pay -- salaries, bonuses, and even perks (apparently these people sometimes can't even pay for their own cars, air travel, tax advice, etc.) -- doesn't leave regular Americans in the dust.

The average American worker made just $34,645 per year last year, and has no additional financial resources. CEOs make millions during their tenures, and their yearly take-home salaries bubble ever upward through bonuses, outrageous perks, and major stock-sale windfalls.

Regular Americans get fired if they fail at their jobs (and sometimes, for no reason at all but downsizing). Disgraced CEOs, on the other hand, are allowed to gracefully "resign" even when they could legally be fired, and often get insanely lucrative golden parachutes when they do.

It's time to pay attention, and vote accordingly
Many investors disregard any information provided by unions, but the lack of discourse between different groups these days is unproductive. Whether you agree with the AFL-CIO in general or not, its data raises a legitimate cost to contemplate. Some of these gigantic paychecks are difficult to justify, especially when you start drilling down on data that's easier to conceptualize, like hourly salary calculations.

Meanwhile, when it comes to shareholder returns, companies with such lucratively paid CEOs don't always provide great returns on investment, particularly when one digs beyond stocks' movements, which are often affected by external factors. How much growth in sales, profit, and other metrics gives a better picture of business health as opposed to short-term-sensitive measures.

The Dodd-Frank Act recommended a new disclosure mandate, which would compel companies to provide investors with the ratio of CEO pay to the average pay of their own employees. I'm hoping the day will come when that more specific data will be available to help inform our say-on-pay votes at the companies we own.

Until then, let's pay attention to this ratio that insults our intelligence -- and sometimes, our investment returns. This is shareholder money -- your money -- after all.

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Check back at Fool.com for more of Alyce Lomax's columns on environmental, social, and governance issues.


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  • Report this Comment On April 17, 2013, at 1:05 PM, rodgerreno wrote:

    I am shocked! The number of people that have comments on taxes and safety net benefits have NO comments on the extraordinary difference between CEO and employee pay.

  • Report this Comment On April 17, 2013, at 1:33 PM, Blackthorn wrote:

    Alyce, While your report is not shocking to anyone actively involved in the management of their own money, it is or should be a bell ringing, to get their attention.

    There are too many"" professional" Board Members, all just too happy to accept all of the associated oerks and play follow the leader. I'm not smart enough to calculate how much these super pay packages and bonus's are as a part of the value of each share of stock. But even a fool knows that it is included in the price of every item and service provided by the company. It is also a deduct from the value of every share of common stock, that keeps it diluted to the point that it makes for good conversation and no cause for concern. It is not only the cost of public pensions and benefits that's bankrupting our economy, a little GREED in the Exec Office goes quite a ways also. Thanks for a good report, now write a call for action!

  • Report this Comment On April 17, 2013, at 3:08 PM, Darwood11 wrote:

    As a long term "President" and "CEO" of several "C" corporations, I think I should point out that my pay was at most a multiple of 3X the lowest wage in the company.

    Yes, you did read that correctly.

    In fact, when the company had problems, and we did have problems and losses, my pay, as president, including all of the perks, was less than that of the front office secretary.

    That's the way it should be and that's the way it should work.

    Yes, investors should be outraged.

  • Report this Comment On April 17, 2013, at 6:09 PM, xetn wrote:

    What about Obama's pay? Don't you think it is a little out-of-whack with the "average" hourly rate?

    Perhaps we should increase the minumum wage to say Ellison's hourly rate. That would fix everything right? Right?

    What a totally idiotic article.

  • Report this Comment On April 17, 2013, at 6:16 PM, Zombie111 wrote:

    Note any parallels with the kings of France mid 18th century?

    Good point as to how much real value for money CEOs provide relative to their renumeration. Probably similar as to how much real influence Presidents have on the running of the country or the economy. If general conditions are favorable, they look good regardless.

    Let them eat stock options.

  • Report this Comment On April 17, 2013, at 6:21 PM, Zombie111 wrote:

    Though to be honest, if someone offered me $33000 an hour, I would most likely take it, and do what most people do, which is to justify it later on the basis that I must be worth it, or else why would a bunch of smart people offer it to me? The board of directors are not that accountable...yet.

  • Report this Comment On April 17, 2013, at 6:29 PM, stevedb wrote:

    BTW, what's the AFL-CIO president's salary & benefits package look like. Juicy I bet

  • Report this Comment On April 17, 2013, at 6:51 PM, kabrink wrote:

    I would say those CEOs deserve their pay package far far more than athletes and especially actors do. CEOs are guiding huge organizations that provide jobs for thousands of people. Actors pretty much do nothing but complain and live in excess. At least athletes have to work hard. But, neither provide jobs for anyone else but maids.

  • Report this Comment On April 17, 2013, at 8:09 PM, cardman61 wrote:

    How can anyone say that CEO's don't earn every penny that the get? They have to decide how many workers they can get rid of, and still make enough profit to get their pay. Not an easy Job! Just think! If they didn't do this, their only other option would be to figure out how much less they would have to get paid, in order to save the jobs of those worthless people that actually make things.

  • Report this Comment On April 17, 2013, at 8:12 PM, VieuxCarre wrote:

    Investor Peter Thiel claimed once that the best predictor of a start up getting successfully funded was the salary of the CEO. Low was better, with the average around $120k. A lower pay check helped to align the CEO with the main goal of the start up, getting bought out/funded. I'm pretty sure he had data to back that up but I don't think he shared his numbers.

    It is surprising that institutional investors haven't done a similar study on established firms.

  • Report this Comment On April 17, 2013, at 8:30 PM, gkirkmf wrote:

    Stevedb....

    You just have to use google to find out the afl-cio president's salary.

    Name Title Gross Salary

    RICHARD TRUMKA PRESIDENT $272,250.00

    A little less than 10 times the average American worker, and possibly much less than 10 times the average union worker.

  • Report this Comment On April 17, 2013, at 9:58 PM, enginear wrote:

    As a recent retiree, that started working in the mid to late 60's, starting at $0.75/hour, and ending at about $40/hour as a well qualified, and educated blue collar worker, I've seen a lot.

    It always bothered me that while I was able to manipulate matter and machinery into something that could perform a job for humankind, with foot-pounds of energy against the physical world, some other people that could hardly change a light bulb got paid more (a LOT more) to convince people to buy something.

    Fact is, every product needs to be sold, and those that do it well command high wages. The market determines these things. I think many CEO's looked at the market first, then went straight toward the high pay. Most of the rest of us don't look first, we sort of stumble into a career. Do they 'earn' it? Relative to the refrigeration mechanic, I'd say not really, but I have a stilted viewpoint (most do).

    Is it fair? No... if it were it would be about the only thing out there that is. Too bad, but that's what it we have. Should we 'occupy'? I don't like it, although raising awareness is good, and votes are coming in to guide the boards now...perhaps more will happen, I don't know. These things change slowly over time, and the pendulum will swing back.

  • Report this Comment On April 18, 2013, at 12:23 AM, catcreek wrote:

    $19.77 per hour does not compute with $34,645, but with $41,121 per year.

  • Report this Comment On April 18, 2013, at 2:48 AM, JadedFoolalex wrote:

    Funny how most people who own stocks of companies with highly paid CEOs don't complain very much when those highly paid CEOs guide their companies into rich dividends and capital gains, but GOD help those CEOs who have the audacity to go to business schools, work their way through colleges and Universities as well as working their way through the ranks and spend hours and hours honing their skills to guide billion dollar companies to make their stockholders wealthier, WELL, shame on you people for being rewarded!!!!!!

  • Report this Comment On April 18, 2013, at 8:42 PM, JaxJaguar wrote:

    How would you like to work for a company that says it cannot afford to match employees 401K contributons, cannot give raises this year, and cannot match contributions to the employee stock purchase plan, yet the CEO makes almost $10 million and the 5 most highly compensated employees make 25 million? That is where I work. They pd out about 150 million in fines / litigation in the past 12 months, and they have 200+ millions set aside for this year as well. Add to this tons of long term debt.......I just can't figure out why the stock is in such a slump.

  • Report this Comment On April 18, 2013, at 8:58 PM, rboudbee01 wrote:

    I believe it is Japan (or if I'm wrong, another country) that has a law restricting -- not the salaries of CEOS -- but the ratio of CEO to lowest paid worker. Thus, in order for the Ceo pay to increase, the entry level has to also increase.

    I hope someone can correct me or clarify this. It seems like a good idea to me.

  • Report this Comment On April 18, 2013, at 9:09 PM, TMFBreakerRob wrote:

    Excellent article, Alyce!

    In the past, unions formed to offset corporate excesses. The results were instrumental toward the expansion of the middle class.... and there were numerous benefits for worker safety as well.

    Now... we have another form of corporate excess with no counterbalance. Boards are compliant, stockholders have an extremely difficult time over-riding management actions.... what can be done?

    I think this excess will be counterbalanced in time by legislation. I don't like the government involvement, but the outrage is damaging the public's perception of capitalism.... to the eventual danger *to* capitalism. Unfortunate, but pendulums swing back... or the system breaks.

    Will that legislation be controls on compensation or "just" high marginal taxes with re-definitions of how income is recognized? Dunno..... but I suspect it's coming....

  • Report this Comment On April 19, 2013, at 1:57 PM, CoSyBob wrote:

    Incomes in the millions are far less for personal consumption as transfers of ownership power . Those incomes become the investment ammunition for those who have been deemed by their peers successful in allocating massive resources . One assumes they will also be better custodians of their additional personal resources than some State bureaucracy .

  • Report this Comment On April 19, 2013, at 3:49 PM, WineHouse wrote:

    To xetn -- your comment was dumb. Presidential pay is $400,000 per year. That's ten times the pay of the average American, but then again the Pres is not paid by the hour -- he's basically "on" 24 hrs a day, 7 days a week. He even lives in the same building as his office. So on an hourly basis, that is only slightly more than three times the average hourly pay in this country. Not only that, he makes less than the typical Big Ten football coach (by a factor of more than two), and less than a top baseball player or football player (by a factor of about thirty).

    Do you really think the President of the US, given his responsibilities and working hours, is really overpaid?

    Good grief.

  • Report this Comment On April 20, 2013, at 4:10 PM, ChrisBern wrote:

    The question I would ask is "why do I care". e.g. why do I care that Larry Ellison for example is making $46,000/hour? I have never bought an Oracle product in my life. I don't own Oracle stock. Oracle does not get any of my tax contributions. Zero of my money goes to Oracle, and so Ellison's income is no more relevant to me than the income of the King of Sudan.

    If Oracle can have a successful business model in spite of (or even because of) having an extraordinarily highly-paid CEO, more power to them. In contrast if they can hire an equal or better CEO for less money, then that's probably what they should do. But neither scenario has anything to do with me, just like it doesn't matter to me how much my next door neighbor is making.

    Now if you're an Oracle investor and you're peeved, then you should consider just selling the stock because your 0.000001% vote or whatever it is won't be enough to make a difference anyway! But if you're as non-invested in Oracle as I am and are just whining about other people's riches...well that's just a waste of mental energy.

  • Report this Comment On April 22, 2013, at 5:57 PM, sdej wrote:

    While there are plenty of comments defending the pay that CEOs get relative to their workers, there is one defense that is startlingly missing -- why do CEOs get paid so much more than in the 1980s? Do those defending egregious executive pay believe that CEOs in the 1980s were being unfairly underpaid? Or is there some other reason? If they were still being fairly paid back then, are today's high wages just because there is so much more money to be made for a company now compared to 30 years ago? Is that extra money, alone, worth a quadrupled salary?

    Furthermore, I see a lot of these comments defending CEO pay by arguing that if the company is solvent then surely the business practice is defensible. I suspect that many of these defenses are just knee-jerk reactions to a perceived attack people they identify with. Ask anyone of these defenders about certain companies' extraordinarily high yields, excessive debt, or other risky financials and they certainly won't use the argument that solvency in the short term means a defensible financial condition. For such a financially literate community, it sounds like many of these Fools are just fools in disguise.

  • Report this Comment On April 22, 2013, at 6:39 PM, RouteReflector wrote:

    @catcreek

    The average worker in the US works less than 40 hours per week. As such, using a 2080 multiplier is inaccurate.

  • Report this Comment On April 22, 2013, at 7:39 PM, RenegadeIAm wrote:

    Lower the barriers to entry for starting a small business and hiring employees. Increase competition for the skilled people in those companies.

    Once people move out of the mind numbing gilded cage of the cube farms and create their own consulting and other businesses and then sell those skills back to the big companies, pay will move up.

    But if an employee (at Microsoft, for example) also gets $30k in health care costs and other benefits worth thousands of dollars, and he's cozy where he is, then the pay is going to stay where it is.

  • Report this Comment On April 22, 2013, at 8:10 PM, defridgerator wrote:

    My first reaction to this comment was astonishment. In my personal opinion, no one should be payed that much money. To me, it sounds exorbitant. What are CEO's doing for the companies to cause them to be so overpaid.

    Are they being overpaid? I do not know a 1/10th of what they do for the company other than making it more profitable. And each company has a board of directors that elect their CEO, and determine what he will be paid. If the CEO doesn't provide the services that he was hired for, I suppose it's pretty easy for him to be fired and someone else to replace him.

    We do not live in a socialist marketplace. There is no reason to equalize the payscale of the companies because you don't agree with the CEO's pay. The government has no reason to make regulations regarding such. Distribution of wealth from the rich to the poor is socialism. Do you live in a socialist economy or free market?

    Also, each company has their own decisions to make regarding CEO pay. If they can justify the expenses and profitability of the company by paying their CEO's more then that is their decision. They could probably shift that cash elsewhere but would their company be as profitable? If not, then I don't see any reason to reduce their pay.

    Though I do think it's crazy comparing it to my own income, I'm just a plebian. The worth I give to my company is what I'm getting paid for. I'm not in a position to make decisions that alter the profitability of the company. And so I'm getting paid my worth. That's all anyone can ask.

  • Report this Comment On April 22, 2013, at 9:03 PM, NewAlchemist wrote:

    NBA players (some that aren't even that good) can make 20 to 30 million per year. Actors and actresses in Hollywood can make 20 million dollars for 1 movie. Where is the outrage at those salaries? The people that complain that CEOS make too much money never complain that Gilbert Arenas or Julia Roberts are overpaid.

    CEOS. A lot of them are Ivy league educated. They were top performers their entire careers. They worked their way up the corporate ladder. They had to sacrifice family life for years to get where they are. I'll bet you wouldn't complain about their entry level salaries? I'll bet you wouldn't complain about their salaries when they were middle managers? But now they are 60 years old and at the top and they make too much?

    Why is it fair to compare a 60 year old CEO with a Harvard degree to a 16 year old worker that hasn't even graduated high school yet? When you compare a CEO to the average American that is what you are doing.

    Correct me if I am wrong but Larry Ellison founded Oracle. He started the company, shouldn't he get to reap the rewards from his creation?

    These, "CEOS make too much money" arguments are rooted in jealousy, fear and ignorance.

  • Report this Comment On April 22, 2013, at 10:45 PM, SuntanIronMan wrote:

    @NewAlchemist

    Comparing CEOs to athletes and actors is kind of missing the point. It is not about complaining how much money people in general make (although that is certainly some people's agenda, for sure). The point is that these CEOs are getting paid with money that belongs to us shareholders.

    That basketball player's salary is not coming out of my wallet. I don't care what Gilbert Arenas makes. A CEO of a public company's salary though, that actually our money. If I am a shareholder in that company, that is my money he or she is enriching themselves on.

    If it were a private company, that would be one thing. But a publicly-traded company owned by the shareholders, but that is another matter entirely.

  • Report this Comment On April 22, 2013, at 11:08 PM, phexac wrote:

    Yeah, let's complain about Larry Ellison who created a company that is worth billions, provides employment to tens of thousands of people and whose products are used by hundreds or thousands of firms earns too much from his company. I would much rather wonder about the money Alyce Lomax makes. If this sham of an article is representative of her work, she certainly doesn't deserve any of it.

  • Report this Comment On April 22, 2013, at 11:40 PM, SuntanIronMan wrote:

    @phexac

    Larry Ellison created Oracle, but Oracle is no longer Larry Ellison's company (not entirely his). It is a shareholder-owned company. And as shareholders, we should care what happens with shareholder money... because shareholder money is actually our money. If it were a privately-owned company, he could do whatever he wants and more power to him. But he lost that ability (or should have...) once it became a shareholder-owned company about 27 years ago. As shareholders, we collectively (should) have a right to determine just how much shareholder money goes to the executives of our shareholder-owned companies.

  • Report this Comment On April 23, 2013, at 12:34 AM, TerryHogan wrote:

    I can see outrage at the pay of a scion of a rich family who basically 'inherits' a job (A Ford maybe, or a Walton). Like if Bill Gates' son were to run Microsoft after Ballmer and get paid huge bucks. But otherwise, most of these jobs are basically open to anyone with the requisite skills. Stop sitting in front of your computer complaining and go get an MBA/engineering degree and put in 70 hour weeks for 25 years, then you can have the millions. That's what makes America great!

    And please let's not legislate CEO pay. If you're really outraged about it, instead try to make higher education more accessible, and maybe institute larger taxes on inter-generational wealth transfers.

  • Report this Comment On April 23, 2013, at 12:35 AM, neocolonialist wrote:

    I'm no math wizard but $19.77/hr != $34,645/yr. That's about as slanted as this whole article.

  • Report this Comment On April 23, 2013, at 1:03 AM, akutach wrote:

    What makes the ratio only seem audacious is that people ignore the basis for each type of salary. CEO pay is, generally speaking, tied to corporate performance, size, and profitability. Whereas worker pay is tied to the cost of capital relating to replacement/retention cost which in many cases is pegged to the cost of outsourcing or exporting the job.

    This increasing ratio may be a consequence (unintended?) of globalization in that work force globalization draws down wages for all transportable jobs to the lowest cost provider whereas reducing barriers to global trade increases profits and/or scale to the benefit of corporations which are well suited to take advantage.

    The golden parachutes are indefensible.

  • Report this Comment On April 23, 2013, at 1:17 AM, remmdawg wrote:

    The AFL-CIO is basically a corrupt criminal gang/terrorist organization. They're just as corrupt as the worst corrupt businessmen. But the numbers are interesting, not because there's any god-given ratio that's appropriate but because the ration defies common sense. Anybody who has followed the business world for awhile realizes that executives, or any other paper pusher for that matter, aren't worth their stratospheric pay. Indeed, many are worth less than nothing to companies since they often destroy the company. Why are they overpaid? I would point to one major reason - crony capitalism. Corrupt politicians allow these criminals to get away with financial murder and even reward them - think Solyndra many many times over. They corrupt and pervert the markets, thereby preventing a free market from ridding us of these worthless leeches. They raise barriers to competition and new business formation. They bail out the incompetent and/or corrupt failures. A truly free market undistorted by crony capitalism and with flourishing competition would flush out these excesses.

  • Report this Comment On April 23, 2013, at 1:30 AM, CHill8008 wrote:

    Right now I'm more worried about how much of my subscription fee goes to Alyce Lomax. More like an article that insults our intelligence.

  • Report this Comment On April 23, 2013, at 7:47 AM, SuntanIronMan wrote:

    @CHill8008

    It is well within your rights to cancel your subscription if you disagree with the opinions of this site's writers. Just like it is well within your rights as a shareholder to demand accountability of the people in charge of the companies you own as a shareholder. I'm personally more worried about the companies I invest my own money in exchange for part ownership, but that's just me.

    The board of directors are (in theory, not practice) there to provide accountability to the company shareholders (among other duties). That's their purpose. That's what they are suppose to do. And if they fail to do that, they are failing the shareholders (who are us).

  • Report this Comment On April 23, 2013, at 9:06 AM, damilkman wrote:

    Movie starts, sports stars, and entertainers have something in common with CEO's. They are paid that amount of money because the hope is their performance will lead to a big payoff. Just like we cannot predict whether Kevin Costner will make money in "Waterworld" or Grant Hill bring an NBA championship to Orlando, we cannot predict which CEO's will raise a company. Sometimes the free agent fails. Nothing more nothing less.

  • Report this Comment On April 23, 2013, at 9:23 AM, The1MAGE wrote:

    I do not see why we need to look at ratios. What is the purpose other then promoting envy? What is a CEO worth if he increases profits by $1B in a year?

    When a good CEO becomes available, businesses fight for them, and that pushes up their salaries.

    Are they all worth what they are paid? No, and many of them should be fired. There are also CEO's who know how to manipulate company stock in a way that benefits them, but hurts the company, and they should also be fired.

    Forgive me, but why are we comparing average people (which includes teenagers,) to CEO's of massive corporations anyway? Should we compare the average employee to a top Brain Surgeon? Why is he making more money?

    People don't magically become Brain Surgeons, Pro BB players, or CEO's of major corporations without a ton of work, and talent.

    It is better to look at each CEO, and figure out if they are earning their incomes. Not just look at the whole group, and just bitch about it.

  • Report this Comment On April 23, 2013, at 9:47 AM, neocolonialist wrote:

    @CHill8008

    Amen! I tire of these heavily slanted articles all the time from the Fool. I really tire of supporting it with my money! It's sad that an investing site is constantly working against a free market in such a subversive manner.

    @WhichStocksWork

    "it is well within your rights as a shareholder to demand accountability of the people in charge of the companies you own as a shareholder"

    I couldn't agree more. I just wish this was the tact this article had purported. Rather, the article supports the government regulating businesses instead of leaving the shareholders to hold the companies accountable.

  • Report this Comment On April 26, 2013, at 10:55 AM, crashchandler wrote:

    Great comments and any article that creates such controversy and gets the juices flowing should be applauded .

  • Report this Comment On April 26, 2013, at 1:09 PM, dahlaaday wrote:

    And then there is the phrase "To approve, on an advisory basis, the company's executive compensation."

    So even if your vote is counted, it has no power! So you can now leave before the fat lady sings.

  • Report this Comment On April 29, 2013, at 10:32 AM, geezer27606 wrote:

    A great CEO is worth every penny paid. Look at Ford and Apple compared to GM and Kodak. Stockholders can see the difference. The problem is that poor CEO's are still employed. They should be replaced.

  • Report this Comment On April 30, 2013, at 5:03 AM, banker33 wrote:

    Shareholders complaining that CEO pay is excess should sell their stock and start their own company. We still live in a free country. My guess is that they would've already done that if they could, but they can't, so they whine about others success. When the whining doesn't work, they then want a law to force everyone to follow their beliefs.

    The Union leader making only 10 times the average worker seems appropriate to too high. I would sell all my stock in whatever company he became CEO of, because it would soon be bankrupt.

    The President's pay always seemed low to me but as we learn about all of the self serving, insider dealings and general lack of ethics in the government, I have a hard time arguing that any of these people are underpaid. In fact, I would fire most of them but I only have one vote and in many cases, no vote. How can Pelosi, Reid, and Frank be lifetime members of congress? That's the best we can produce in this great country?

  • Report this Comment On April 30, 2013, at 5:41 AM, SuntanIronMan wrote:

    @banker33

    Selling your shares is certainly one option and the right of any shareholder of a public company.

    Pushing for change in a company you partly own as a shareholder is another right you have.

    These are shareholder-owned companies. And us as shareholders have many such options.

  • Report this Comment On May 02, 2013, at 10:19 PM, TwinMount wrote:

    These CEO's are not leaders, they are mercenaries and the fact that they demand such high compensation questions both their commitment to the company and their commitment to the country that gave them the opportunities. If you use common sense and analyze what this is doing to the USA, you will realize that their actions are more destructive than all of the terrorists combined.

    The key problem is the fact that other well educated and trained professionals see these rates and want them as well. Thus health care and legal costs are onerous compared to the rest of the world. US companies and shareholders suffer, but the workers are laid off and the jobs sent overseas.

    No one needs this level of remuneration. You can live like a king on $1 million a year salary. Like Steve Jobs, I question the CEO's need for more money. Blackberry lost a number of their key executives when they cashed out and left. How certain are these companies that the pay packages won't just encourage the execs to leave and enjoy their riches.

    The ridiculous state of executive compensation in the US is primarily due to one-upmanship and the fact that the compensation consultants get a % of the total plan they recommend and the head hunters get a % of the salary too.

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